Have you tried adding the nameservers provided by your ISP rather than using 192.168.1.1 which I assume if your router? They should be available within the help section on your ISP's website. Usually, your router won't be able to work as nameserver, which seems to be why you're failing to get onto the net, though can see the router. Try:
Code:
ping -c1 216.239.55.99
which tests to see if you have physical connection to the Internet and can ping Google. If this works, it's definately a DNS issue, which seems to be the case from the error message you get and the config you've got.